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900-mile natural gas liquids pipeline proposed for Bakken

BISMARCK — Oneok recently announced plans for a 900-mile natural gas liquids pipeline that will accommodate increasing North Dakota production and play a role in reducing natural gas flaring.

The proposed Elk Creek Pipeline will have the capacity to transport up to 240,000 barrels per day of natural gas liquids from a terminal near Sidney, Montana, to Bushton, Kansas.

The pipeline will run adjacent to Oneok's existing Bakken NGL and Overland Pass pipelines, which are operating at full capacity.

Terry Spencer, Oneok president and CEO, said in a statement that a new pipeline is "critical to meeting the needs of producers who are increasing production and are required to meet natural gas capture targets in the Williston Basin."

The $1.2 billion Elk Creek Pipeline will not cross North Dakota but will connect to existing pipelines in northwest North Dakota. It's expected to be complete by the end of 2019, but still needs regulatory approvals from federal, state and local agencies.

Justin Kringstad, director of the North Dakota Pipeline Authority, said additional pipelines are needed to transport growing volumes of natural gas liquids, such as ethane, propane and butane.

Kringstad estimates that North Dakota produces more than 400,000 barrels of natural gas liquids per day. But due to insufficient pipeline capacity, about 40,000 to 60,000 barrels a day are transported by rail, he estimates.

Under Kringstad's forecast, North Dakota natural gas liquids production is projected to more than double by the 2030s to between 800,000 and 1 million barrels per day.

"As we look to the future at the growth opportunities for natural gas liquids, there's going to need to be additional transportation solutions put in place," Kringstad said.

Oneok said the Elk Creek Pipeline could be expanded to transport 400,000 barrels per day with additional pump facilities. The pipeline, which will cross Montana, Wyoming, Colorado and Kansas, also will transport natural gas liquids from the Rocky Mountain region.

The Elk Creek Pipeline would transport Y-grade natural gas liquids to existing Oneok facilities in Kansas. That means the natural gas liquids are mixed together for transportation and later separated into products, such as ethane and propane.

North Dakota oil industry leaders are working to attract additional investments in natural gas infrastructure to reduce flaring. The industry flared more than 320 million cubic feet per day of natural gas in October, the most recent data available from the Department of Mineral Resources.

Overall, the industry met its target of capturing 85 percent of Bakken gas produced in October, but 11 companies fell short. The gas capture targets set by the North Dakota Industrial Commission become more aggressive later this year at the same time that natural gas production is projected to continue increasing.

Additional pipeline capacity for natural gas liquids plays a role in reducing flaring by providing a cost-effective, efficient transportation option, Kringstad said. But other infrastructure also is needed to reduce flaring, such as additional gathering pipelines and natural gas processing plants.

"This is just one piece of that larger flaring puzzle," Kringstad said.

Meanwhile, Oneok has applied to the North Dakota Public Service Commission to convert about 45 miles of natural gas gathering pipelines into a natural gas liquids transmission pipeline. The project is located between Oneok natural gas processing plants in Williams and McKenzie counties.

The conversion would transport up to 50,000 barrels per day of natural gas liquids from Dunn and McKenzie counties to Oneok's existing pipeline system. Construction is proposed to begin in February.